Eddie Precision builds out global strategy with new facilities and product focus

Based in Yantai, China, Eddie Precision makes a variety of components for off-highway equipment, including hydraulics, linear motors and electrical systems. The company currently supplies hydraulics components to Chinese construction equipment brands XCMG, LiuGong and Zoomlion.

“We want to become an international company, and expanding our global customer base is the aim,” said Song Fei, chairman and CEO of Eddie. He spoke with Power Progress’ sister publication International Rental News about the company’s plans.

Challenges and Opportunities

Song Fei, chairman and CEO of Eddie Precision. (Photo: KHL Staff)

Eddie got its start in 2003 by providing the construction industry with hydraulic hammers, crushers, shears and grapples. Since then, the company has grown significantly. With six wholly owned subsidiaries, Eddie delivers a broad portfolio of products, including pumps, control valves and motors as well as machining cutters, industrial robots, battery packs and energy storage systems.

However, the company has been stymied on the home front. China’s economy has cooled in recent years, driven in part by the real estate market crash. At the same time, global tariffs have complicated export efforts for component makers like Eddie.

Thus, Eddie is looking to international markets for the growth it seeks. Song said that via international expansion as well as global exports, which currently represent just 13 percent of Eddie’s current revenue, the company hopes to more than triple its annual revenues in the next five years — growing from $416.7 million today to $1.4 billion by 2030.

Expansion Plans Abroad

The company has already taken steps toward this goal. Last August, Eddie partnered with Kawasaki Heavy Industries to create Eddie KPM. The joint venture supplies customers with hydraulic components, including pumps, control valves and swing motors.

Industrial robots produced by Eddie Precision. (Photo: KHL Staff)

Eddie now intends to open three additional factories abroad and increase domestic production that is geared toward exports. Among them will be a new $35 million, 20-acre factory in Thailand, with construction planned to begin in July. The plant will produce hammers and other hydraulic components. A hydraulic parts base in India is also on the docket.

However, the company’s footprint could expand beyond Asia.

“Europe is a good place for hydraulic equipment, so it is very important to us.” Song said, signaling future expansion plans on the continent. Eddie is looking into possible locations for production facilities and will likely make a decision in the coming months.

“We could potentially buy a company,” Song said.

Song said the company could also look to expand in other parts of the world. The U.S. is an obvious choice, he said. At present, the company derives about 5 percent of revenue from the U.S. It hopes to grow this to about 15 percent.

Nonetheless, Song said Eddie will take a “wait and see” approach to any expansion plans in the U.S., as it — like many around the world — watches for the effects of President Donald Trump’s trade policies.

“It depends on the market conditions,” he said. “It is a very difficult market out there, and the American market is particularly tough.”

Competitive Edge

To support this international push, Song said Eddie is leaning on what he sees as two of the company’s strongest assets: its robust production capabilities and its commitment to R&D. About 15 percent of the company’s personnel are employed in R&D, with investments in that department equal to about six percent of Eddie’s annual revenue.

Additionally, production in China is particularly cost-effective. Coupled with Eddie’s global distribution network, the company believes this bodes well for Eddie’s global growth.

Parts for aerial platforms produced by Eddie. (Photo: KHL Staff)

Despite its global aspirations, Eddie will not ignore opportunities at home. It expects to increase export revenue from the company’s 173-acre Chinese facility with a new plant in Yantai at a 25-acre site. Additionally, there are plans to build another 20-acre plant in the nearby industrial city of Jinan.

A New Division

Additionally, Song said it will establish an aerial platform division to capitalize upon that sector’s increasing importance to the company’s business. The new division will move by the end of the year to a former hammer factory that the company has adapted specifically for its needs.

“With everything that is happening at the company, there was a risk that the access side of the business could have been pushed aside and forgotten, so it’s important we keep focused on it,” Song said. “Making it independent will be good to expand the product type in the company and will help expand relationships with current customers.”

Song added that Eddie has been discussing its new focus with key access-related brands outside of China. He said he is confident the company will be able to make deals in the future.